SPEECHES & TESTIMONY

Good morning. I would like to start by thanking Chairman Schapiro, my fellow Commissioners, members of the Securities and Exchange Commission and our distinguished panelists for being here today. It’s good to be at the SEC and working cooperatively to best serve the American public. In our first day of meetings yesterday, we heard from experts with valuable insight on the areas where the CFTC and the SEC could better promote market integrity and transparency and prosecute fraud, manipulation and other abuses through greater consistency in our regulations.

I believe that there are three broad areas where the CFTC and the SEC must work to enhance our regulatory structures. First, we must close the gaps that exist between the two agencies’ financial regulatory authorities, including over-the-counter derivatives. Second, we should ensure that regulatory overlap only exists where it is beneficial, such as in joint enforcement, and not when it can be used for regulatory arbitrage. Third, we must explore where it is appropriate to bring consistency to the two agencies’ regulation over similar products, practices and markets.

Participant testimony and yesterday’s panelists highlighted at least twelve specific areas where we should consider possible regulatory changes to bring consistency and best protect the American public. As I summarized at the end of yesterday’s meeting, they are:

11. Mutual recognition of entities regulated by foreign jurisdictions; and

12. Principles-based versus rules-based regulatory oversight.

I hope that each of today’s panelists will give their views on these issues and give us a sense of if they think there are additional matters that we should keep them in mind.

I take very seriously President Obama’s call to “harmonize regulation of futures and securities.” As we discuss these issues today, I would like to reaffirm that there should be no sacred cows. I believe that we should check turf at the door and focus exclusively on what is best for the American people.

We look forward to hearing a wide variety of viewpoints on these very important issues. Written comments on the topic of this hearing also will be accepted from the public until September 14th, 2009, and included in the record. Please visit cftc.gov or sec.gov for a link and instructions to submit written comments for the record.